Category: US Dollar Index

The Dollar Index is consolidating on the weekly chart, indicating uncertainty. Respect of resistance at 80.00 would warn of another test of support at 78.00, while breakout would indicate continuation of the primary up-trend. In the longer term, breakout above 82.00 would offer a target of 86.00*, while failure of support at 78.00 would signal a primary down-trend. Reversal of 63-day Twiggs Momentum below zero would also warn of a primary down-trend.

* Target calculation: 82 + ( 82 – 78 ) = 86

Gold remains undecided despite a sharp fall on the Gold Bugs Index. The long tail on last week’s candle for spot gold indicates buying pressure at the $1600 support level. Recovery above $1700 would respect the long-term trendline and indicate another test of $1800, suggesting the start of a new up-trend. Breakout above $1800 would confirm, offering a target of $2000/ounce*. A 63-day Twiggs Momentum trough predominantly above the zero line would strengthen the bull signal. Reversal below support at $1600, however, would warn of a primary down-trend — confirmed if support at $1500 is broken.

* Target calculation: 1800 + ( 1800 – 1600 ) = 2000

The Gold Bugs Index, representing un-hedged gold stocks, is in a clear primary down-trend since breaking support at 500. Peaks below zero on 63-day Twiggs Momentum also signal a strong down-trend.

The Dollar Index is retracing to test primary support at 78.00 on the weekly chart. Respect of the rising trendline would signal continuation of the primary up-trend, while failure of support would warn of a down-trend to test support at 73.00. Reversal of 63-day Twiggs Momentum below zero would strengthen the bear warning.

* Target calculation: 82 + ( 82 – 78 ) = 86

Despite the weakening dollar, spot gold is headed for the long-term rising trendline on the weekly chart. Failure of support at $1600/ounce would warn that the primary trend is weakening, while failure of $1500 would signal that the trend has reversed. Reversal of 63-day Twiggs Momentum into negative territory — for the second time recently after several years above zero — already warns of a primary down-trend.

* Target calculation: 1500 – ( 1800 – 1500 ) = 1200

The 4-hour chart shows gold respecting resistance at $1700 before retreating below medium-term support at $1670. Failure of short-term support at $1655 (the 0.618 Fibonacci retracement level) would test $1630 and signal continuation of the down-trend. Recovery above $1700 is unlikely but would signal respect of the long-term rising trendline (on the weekly chart above) and resumption of the primary up-trend.

Spot gold found short-term support at $1640/ounce but is likely to continue its correction to test primary support at $1500. Reversal of 63-day Twiggs Momentum below zero, for the second time, threatens an iceberg top which would signal a primary down-trend. Breach of primary support at $1500 remains unlikely, but would signal a decline to $1200*.

* Target calculation: 1700 – ( 1800 – 1700 ) = 1600; 1500 – ( 1800 – 1500 ) = 1200

The US Dollar continues in a primary up-trend, the Weekly chart showing the Dollar Index headed for another test of support at 78.00. Failure would warn that the trend is weakening, while respect would signal another attempt at 82.00

* Target calculation: 82 + ( 82 – 78 ) = 86

The US Dollar Index broke resistance at 80 on the Weekly chart, signaling an advance to 82. The Index is already in a primary up-trend, as indicated by 63-day Twiggs Momentum above zero. Breakout above 82 would offer a target of 86*.

* Target calculation: 82 + ( 82 – 78 ) = 86

Spot Gold followed through below last week’s low, indicating a correction to test primary support at 1500. Respect of the long-term rising trendline would indicate the primary up-trend is intact, but reversal of 63-day Twiggs Momentum below zero for a second time warns of a down-trend. Target for a down-trend would be 1200 to 1400*.

* Target calculation: 1600 – ( 1800 – 1600 ) = 1400

The Hourly chart shows short-term support at 1635 and resistance at 1650. Failure of support would test 1600, while upward breakout from the trend channel would signal retracement to test the new resistance level.

Spot gold ran into resistance at $1800/ounce and is testing medium-term support at $1700. Recovery of 63-day Twiggs momentum above zero signals a primary up-trend but we will not have confirmation until there is a clear break through $1800.

* Target calculation: 1800 + ( 1800 – 1500 ) = 2100

The Dollar Index is conversely testing support at 78.00. 63-Day Twiggs Momentum may be slowing but the dollar remains in a primary up-trend. Respect of support would signal continuation — and weaker demand for gold.

* Target calculation: 80 + ( 80 – 75 ) = 85

Spot gold displays a small flag consolidation, suggesting continuation of the advance to test $1800/ounce. Breach of the descending trendline indicates that the down-trend has ended and breakout above $1800 would signal an advance to $2100*. Respect of the zero line by 63-day Twiggs Momentum would strengthen the signal. A strengthening dollar, however, would weaken demand for gold.

* Target calculation: 1800 + ( 1800 – 1500 ) = 2100

The US Dollar Index found support above 78. Recovery above 80 would indicate another test of resistance at 82. Rising 63-day Twiggs Momentum continues to signal a strong up-trend. Breakout above 82 would confirm the target of 85*.

* Target calculation: 80 + ( 80 – 75 ) = 85

Spot gold is consolidating below resistance at $1800. Until we have a breakout there is no confirmation that gold has started a new up-trend. Reversal of 63-day Twiggs Momentum below zero would warn indicate weakness.

* Target calculation: 1800 + ( 1800 -1500 ) = 2100

US Dollar Index continues to decline, boosting gold and commodities. Respect of the rising trendline would confirm the primary up-trend — as would a trough on 63-day Twiggs Momentum that finishes above the zero line.

* Target calculation: 80 + ( 80 – 75 ) = 85